National —
On July 1st, 2024, Mr. Sorathep Rojpotjanaruch, the President of the Thai Restaurant Business Association, submitted a letter to Thai Prime Minister Srettha Thavisin, urging immediate consideration of economic stimulus measures to prevent further closures of restaurants.
The closures of many restaurants were due to the current severe economic downturn, with dwindling purchasing power among Thais, rising costs of raw materials such as fresh vegetables, and high electricity bills.
In 2019, before the COVID-19 pandemic, the total revenue of the Thai restaurant business was approximately 420 billion baht, accounting for 7% of the country’s GDP. Production costs have since risen by about 50%, with raw material costs increasing by 20-30%, including essential items like MSG, dairy, and other main ingredients, said Sorathep.
Furthermore, in 2024, the restaurant business sector is expected to grow by 4-5%, with growth meeting targets in the first quarter. However, growth has stagnated since April, and restaurant closures have continued.
For example, a well-known buffet restaurant saw its first-quarter profits plummet by over 143 million baht, said Sorathep. Small street vendors and SME restaurants are struggling to survive due to limited financial resources.
The Association is calling for the Thai government’s urgent measures to stimulate the economy and support the restaurant business, from street food vendors to SME restaurants, to prevent further devastation.
The proposed urgent measures include:
- Revise Outdated Laws: Amend the law that prohibits the sale of alcoholic beverages in restaurants between 2 PM and 5 PM, a regulation in place since 1972.
- Reduce Property Taxes: Lower property taxes for restaurant businesses, which are already burdened with multiple taxes, including a progressively increasing property tax rate.
- Implement Spending Stimulus Measures:
– For SMEs: Allow individuals to deduct up to 20,000 baht in tax for expenses with proper receipts, and businesses up to 100,000 baht.
– For the general public: Provide 2,000 baht per person for three months, on a digital wallet app, to be spent exclusively on food purchases, from street vendors to SME restaurants.
The association hopes these measures will provide much-needed relief and help sustain the restaurant sector through these challenging times, remarked Sorathep.
